The Companion Advisor:
Taxes & Estates
Canada's Top 10 Tax Tips
What better time than the lazy, hazy days of summer to get your tax affairs in
order. Here are Jamie Golombek's top 10 sizzling summer tax strategies.
Written by Jamie Golombek - AIM Trimark
 A Companion Advisor
article
1. SAVE THOSE STUBS
Today marks the beginning of the new public transit pass credit. If you
purchase monthly passes, start keeping those receipts in a safe place.
2. CASH IN ON THE KIDS
Got kids under six? If you are not already receiving the Child Tax Benefit,
you must formally apply for the new $100 per child monthly UCCB payment, which
begins on July 20. Complete the application form available online at cra-arc.gc.ca
3. CHECK YOUR RECEIPTS
Be vigilant about checking your sales receipts to ensure that merchants
have changed their systems to reflect the reduced 6% GST tax rate.
4. THEN CHECK THEIR RECEIPTS
If you have employees, ensure that you've updated your payroll calculations
as of today. The new payroll tables take into account a slight increase in the
tax rate to 15.5% (from 15%) on the lowest income tax bracket (income up to
$36,378).
5. GET A HEAD START
If you received a tax refund instead of blowing it on a round of golf, get
a head start on your 2006 RRSP contribution. The limit this year is 18% of your
2005 earned income, up to a maximum of $18,000.
6. ELIMINATE THAT TAX REFUND
A tax refund is a sign of poor tax planning, and means you're making an
interest-free loan to the government. If you haven't already done so, apply
to the Canada Revenue Agency for a reduction of tax withheld at source. Use
CRA's Form T1213 available online.
7. MIX IT UP
If you are at least 65, consider converting part of your RRSP to a RRIF
earlier than the mandatory age 69 deadline. This is to take advantage of the
recently doubled pension income credit available on the first $2,000 of pension
income, annuities and RRIF withdrawals.
8. THINK OF THE PAYBACK
Make a contribution to your child's or grandchild's RESP and give them a
head start on university tuition.
9. CHRISTMAS IN JULY
With the elimination of the capital gains tax on donations of securities
to charity, review your investment portfolio to determine if you can make your
2006 charitable gifts "in kind." This beats scrambling to write cheques
to charities in December.
10. WHAT'S UP, DOCK?
As the family gathers around the dock, review estate planning strategies
for passing on the family cottage, such as family trusts or life insurance.
Notice:
Fiscal Agents Financial Services Group are not engaged in rendering tax, accounting
or legal professional services or advice. The comments in this article are not
intended, nor should they be relied upon, to replace specific professional advice.
Before acting on material contained herein. Readers should seek advice that
is appropriate to their personal circumstances from a professional advisor.
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, Fiscal Agents Money Management Newsletter
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